US Bankruptcy Help | Bankruptcy, Explained in Plain English
Learn how the different chapters of bankruptcy work, what you can protect, and how the rules differ by state.
Understand Your Bankruptcy Options And Get Clear Next Steps
U.S. Bankruptcy Help is an educational resource for people facing serious debt. We explain how bankruptcy works in plain English, how different bankruptcy chapters compare, and what questions to ask before you make decisions.
If you decide you want legal advice, you can request a consultation with an independent bankruptcy attorney who can review your specific situation.
- What you’ll find here: explanations of Chapter 7, Chapter 13, Chapter 11, the automatic stay, common timelines, costs, and guidance for urgent debt problems like lawsuits, garnishments, foreclosure, and repossession.
- What this site is not: legal advice. Only a licensed attorney can apply the law to your exact facts.
- Our standards: learn how we create and review content on our editorial policy or read more about us on About Us.
Submitting this form asks us to share your request with an independent bankruptcy attorney. We may be compensated for the connection. This does not create an attorney-client relationship.
Start Here: A 2-Minute Overview
This quick video explains what bankruptcy is, what this site covers, and how to decide what to read next.
Choose What You’re Dealing With Right Now
Pick the closest match below for the most relevant next step. If you’re facing a lawsuit, wage garnishment, foreclosure, or repossession, timing can matter.
- Creditor calls, lawsuits, or collection pressure
- Wage garnishment or bank levy
- Behind on mortgage or facing foreclosure
- Car repossession risk
- Considering Chapter 7
- Considering Chapter 13
What Is Bankruptcy?
Bankruptcy is a federal legal process designed to help people or businesses who can’t realistically keep up with debts. When a case is filed, most collection activity must stop through the automatic stay. Bankruptcy can provide relief by eliminating certain debts, setting up a court-supervised repayment plan, or restructuring obligations depending on the chapter.
- Debt discharge: some chapters can eliminate many unsecured debts (like credit cards and medical bills), depending on the case.
- Structured repayment or restructuring: some chapters use a plan to repay certain debts over time or restructure debts under court oversight.
Some debts are harder to discharge than others. For example, student loans generally require a separate legal process to seek discharge, and outcomes vary by case.
Types of Bankruptcy
There are several types of bankruptcy, each designed to address different financial situations. Understanding these types can help you determine which one might be applicable to your circumstances.
Common Bankruptcy Chapters, Explained
There are multiple bankruptcy chapters. Chapters 7 and 13 are the most common for consumer debt, and Chapter 11 is commonly used for business restructuring (and sometimes complex individual situations). Here’s a plain-English overview:
| Chapter | Who It’s Commonly For | Plain-English Purpose |
|---|---|---|
| Chapter 7 | Individuals (consumer debt) | Often a faster option for people who qualify, focused on clearing eligible unsecured debts. Qualification is commonly tied to income and the means test. |
| Chapter 13 | Individuals with income | Uses a 3–5 year plan. Often used to catch up on secured debts (like a mortgage or car loan) and address other debts through the plan. |
| Chapter 11 | Businesses (and some complex individuals) | Focuses on restructuring debts under a court-approved plan. Often used when the case is more complex or involves higher debt levels. |
The “best” chapter depends on your income, assets, debts, exemptions, and timing. A licensed bankruptcy attorney can evaluate what applies to you.
Chapter 7 Vs. Chapter 13 (The Most Common Consumer Comparison)
If you’re focused on consumer debt, many people start by comparing Chapter 7 vs. Chapter 13. Both chapters can trigger the automatic stay (which usually pauses most collection activity), but they work differently. The right fit depends on details like income, the kind of debts you have, and whether you’re trying to keep a home or car.
This is general education, not legal advice. Outcomes can vary based on exemptions, timing, local practice, and your full financial picture.
| Topic | Chapter 7 | Chapter 13 |
|---|---|---|
| Typical Goal | Clear eligible unsecured debts when repayment isn’t realistic. | Use a court-approved plan (3–5 years) to address debts and catch up on certain secured debts. |
| Who It Often Fits | People who qualify under income rules (often evaluated using the means test) and mainly need relief from unsecured debt. | People with regular income who need time to catch up on a mortgage or car loan, or who don’t qualify for Chapter 7. |
| Timeline | Often shorter than Chapter 13, though timing varies by court and case details. | A repayment plan lasting 3–5 years, plus confirmation and completion steps. |
| Keeping A Home Or Car | You may be able to keep property depending on exemptions and whether payments are current. If you’re behind, you may need another strategy. | Often used to catch up over time, which can help avoid foreclosure or repossession, depending on the situation. |
| Learn More | Chapter 7 Guide | Chapter 13 Guide |
What Happens When You File Bankruptcy?
Filing for bankruptcy usually starts with required credit counseling, then a petition with detailed financial information (income, expenses, debts, and assets). After filing, most collection activity must stop through the automatic stay. Understanding the bankruptcy filing process can reduce stress and help you avoid common mistakes.
This website was founded by a bankruptcy attorney with decades of experience filing thousands of cases. The information here is updated regularly and curated by bankruptcy attorneys to reflect common questions and evolving rules and practices.
Talk With A Bankruptcy Attorney If You Want A Case-Specific Review
Some questions can’t be answered reliably without reviewing your income, debts, assets, and timing. If you want legal advice, you can request a consultation.
- Good fit for a consultation: wage garnishment, lawsuit deadlines, foreclosure dates, repossession risk, or uncertainty about chapter choice.
- Transparency: if you submit a request, we may share your information with an independent attorney, and we may be compensated for the connection. This does not create an attorney-client relationship.
Urgent Bankruptcy Issues
These situations are often resolved with bankruptcy. Learn how bankruptcy can help with these tough financial situations.
Explore State-Specific Bankruptcy Basics
Bankruptcy is federal law, but exemptions and local procedures vary by state. Our state guides help you understand the rules people commonly ask about where they live, including exemptions, means test considerations, and local filing details.
We monitor updates from bankruptcy courts, federal agencies, and other authoritative sources so you can learn from information that’s kept current.
Find Bankruptcy Resources for Your State
Get detailed, state-specific bankruptcy information and connect with trusted local bankruptcy professionals.
Benefits Of Speaking With A Bankruptcy Attorney
A qualified bankruptcy attorney can help you understand how the rules apply to your income, assets, debts, and timing. They can also explain local practices and help you avoid mistakes that delay relief.
When Bankruptcy Might Be Worth Considering
People often start considering bankruptcy when they’re facing ongoing collection pressure, lawsuits, wage garnishment, repossession, or foreclosure, or when they’re using high-interest loans or retirement funds just to keep up. Bankruptcy can provide immediate relief through the automatic stay.
Life After Bankruptcy: Rebuilding Your Financial Health
Bankruptcy can feel overwhelming, but many people use it as a turning point. After a case, people often focus on budgeting, building emergency savings, and re-establishing credit carefully.
Common Bankruptcy Myths
Bankruptcy comes with misconceptions. Many people assume they’ll lose everything or that bankruptcy permanently ruins credit. In reality, exemptions often protect essential assets, and many people rebuild credit over time.
Get Personalized Support When You’re Ready
If you’re feeling stuck, you don’t have to figure it out alone. Use our educational guides to understand your options. If you want a case-specific review, you can request a consultation with an independent bankruptcy attorney.
Explore Bankruptcy Help by State
Browse our state guides to learn exemptions, means test rules, costs, and local procedures. Use these links to jump between states and compare your options.
- Arizona
- California
- Colorado
- Florida
- Georgia
- Illinois
- Indiana
- Maryland
- Michigan
- New York
- Ohio
- Oregon
- Pennsylvania
- Tennessee
- Texas
- Virginia
- Wisconsin